232 extension prolongs uncertainty: EC, Eurofer

DNEPR, Ukraine — The United States' decision to extend Europe's exemption from Section 232 tariffs until June 1 only serves to prolong the uncertainty, the European Commission (EC) and European steel association, Eurofer, said on Tuesday May 1.

The US authorities postponed imposing Section 232 tariffs on steel and aluminium imported from the European Union, Canada and Mexico on April 30.

Originally, the EU was exempted from the measures until May 1.

The tariffs - 25% on imported steel and 10% on imported aluminium - were set in March in response to an investigation on national security grounds.

“The US decision prolongs market uncertainty, which is already affecting business decisions,” the EC said. “The EU should be fully and permanently exempted from these measures, as they cannot be justified on the grounds of national security.”

Eurofer concurred.

“Despite all the evidence of the harm to the EU-US relationship - and to our respective economies - the [Trump] administration has opted to continue a policy of uncertainty in its international trade practice,” Eurofer director general Axel Eggert said. “The EU must not bend to unilateral trade measures and should continue to back multilateral solutions under the [World Trade Organization]."

EU steelmakers exported around 5 million tonnes of steel products to the US in 2017, according to Eurofer.

Overcapacity in the steel and aluminium sectors does not originate in the EU, the EC said. Over the last several months, the EU has engaged with the US and other partners to find a solution for this issue.

“The EU has also consistently indicated its willingness to discuss current market access issues of interest to both sides, but [it] has also made clear that, as a longstanding partner and friend of the US, we will not negotiate under threat. Any future transatlantic work program has to be balanced and mutually beneficial,” the EC said.

Eggert said that Eurofer supported the EC in “making sure that the US is aware it cannot take unilateral measures without trade consequences.”

“We believe that as reliable [partners to the] US, there are no grounds for the EU not to be excluded and we welcome the commission’s efforts to ensure continued access to the US market,” he said.

The EC started a safeguard investigation into 26 steel products on March 26 with the intention of shielding the region’s steel industries from the effects of a possible surge in import volumes that could lead to material being redirected from the US due to the Section 232 import tariffs on steel products.